Car scrapping to be extended

Date: 30/9/2009

The car scrappage scheme that sees automobiles that are up to ten years old crushed in return for a £2,000 subsidy to buy a new vehicle is being extended.

Business secretary Peter Mandelson announced the move at the Labour Party Conference.

The scheme is believed to have saved thousands of jobs in the car industry.

It was initially only due to run until next month but various bodies have been keen to see an extension, including the Unite union.

Now, an extra 100,000 new cars are to be bought into the plan.

Paul Everitt, the chief executive of the Society of Motor Manufacturers and Traders, said that the scheme was "extremely important".

"The additional 100,000 vehicles should help to counter the likely negative impacts of a return to the higher rate of VAT and the introduction of first year VED rates," he said.

So far, nearly 228,000 orders have been placed through the scheme.